Baroda profit up 20%, USE turnover up 276%

By Samuel Sanya

BANK of Baroda has registered an impressive 19.45% jump in after tax profits to sh36.9b on the back of massive growth in deposits, interest on loans and deposits, and a near triple jump in incomes from trading securities.

After tax profit grew from sh30.9b in 2013.  The banks board has recommended a dividend of sh2.5 per share for 2014 subject to approval at the annual general meeting, this is an appreciation from sh2 in 2013.

Addressing a media briefing at the Uganda Securities Exchange (USE) board room, Birbal Singh Dhaka, the Baroda bank boss noted that enhanced staff salaries and new Information Technology gadgets are largely behind a sh20b hike in costs.

"We have already acquired licenses to open new branches in Arua and Lugazi. The expansion will enable the bank to get low cost deposits, and reduce our cost to income ratio," Dhaka said.

"We intend to grow our deposit base between 20-25% year-on-year for the next three years," he added.

Dhaka, who doubles as the deputy president of the Uganda Bankers Association (UBA) noted that the banking industry is readying itself to increase capital in order to fulfill new stringent Basel III international banking regulations.

The banks total income rose by 24.8% sh135.2b as non-performing loans and other assets advanced by 17.9% to sh8.4b. Baroda has 400million shares with 20% held by the Ugandan public.

Baroda shares were trading at sh130 per share by close of business on Tuesday with 100,000 bids outstanding. Stanbic traded 111,738 shares at sh33 per share. Umeme traded 848,411 shares at sh480 per share as the all share index inched up to 2061.

The all share index went up from 2034 while the local share index was pegged at 324 for two days straight. Paul Bwiso, the USE Chief Executive Officer (CEO) revealed that the total turnover on the exchange has risen to sh64b from sh17b year-on-year.

He noted that this indicates growing investor confidence in the exchange. He noted that all share index is similarly up by 37% showing that prices as growing to the benefit of shareholders that actively trade on the exchange.